Shri. V.L. Purushotham, Bangalore v. ITO, WARD 4(2),, Bangalore

ITA 1079/BANG/2010 | 2005-2006
Pronouncement Date: 18-11-2011 | Result: Dismissed

Appeal Details

RSA Number 107921114 RSA 2010
Assessee PAN ADDPV5862H
Bench Bangalore
Appeal Number ITA 1079/BANG/2010
Duration Of Justice 1 year(s) 2 month(s) 3 day(s)
Appellant Shri. V.L. Purushotham, Bangalore
Respondent ITO, WARD 4(2),, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 18-11-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 18-11-2011
Date Of Final Hearing 07-09-2011
Next Hearing Date 07-09-2011
Assessment Year 2005-2006
Appeal Filed On 15-09-2010
Judgment Text
PAGE 1 OF 6 ITA NO.1079/BANG/201 0 1 INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES B BEFORE SHRI N K SAINI ACCOUNANT MEMBER AND SHRI GEORGE GEORGE K JUDICIAL MEMBER ITA NO.1079/BANG/2010 (ASST. YEAR 2005-06) SHRI V L PURUSHOTHAM NO.976 7 TH CROSS 2 ND BLOCK BANASHANKARI 2 ND STAGE BANGALORE-50. - APPELLANT PA NO.ADDPV 5862 H VS THE INCOME TAX OFFICER WARD-4(2) BANGALORE. - RESPONDENT DATE OF HEARING : 09/11/2011 DATE OF PRONOUNCEMENT : 18/11/2011 APPELLANT BY : SHRI C P RAMASWAMY ADVOCATE RESPONDENT BY : SMT. SUSAN THOMAS JOSE JCIT O R D E R PER GEORGE GEORGE K : THIS APPEAL INSTITUTED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A)-II BANGALORE DATED 15/04/2010. . THE RELEVANT ASST. YEAR IS 2005-06. THE CIT(A)S ORDER ARISE OUT OF TH E ORDER OF ITO WARD- 4(2) PASSED U/S 271(1)(C) OF THE ACT. PAGE 2 OF 6 ITA NO.1079/BANG/201 0 2 2. THE SOLITARY ISSUE THAT IS RAISED IS WHETHER THE CIT(A) IS JUSTIFIED IN CONFIRMING THE LEVY OF PENALTY U/S 271(1 )(C) OF THE ACT AMOUNTING TO RS.6 20 000/-. 3. BRIEF FACTS OF THE CASE ARE AS FOLLOWS:- THE ASSESSEE/APPELLANT IS AN INDIVIDUAL AND IS A PARTNER IN THE FIRM M/S SILVERLINE INVESTMENT. THE PARTNERSHIP FIR M IS ENGAGED IN REAL ESTATE BUSINESS. THE RETURN OF INCOME FOR THE CONC ERNED YEAR WAS NOT FILED WITHIN THE DUE DATE SPECIFIED U/S 139 OF THE ACT. A SURVEY U/S 133A WAS CARRIED OUT IN THE PREMISES OF THE PARTNERSHIP FIRM ON 25.2.2007. AN AGREEMENT TO SALE DATED 2/12/2004 WAS FOUND AND IMP OUNDED DURING THE COURSE OF SURVEY. AS PER THE SAID AGREEMENT TO SALE THE ASSESSEE HAD AGREED TO PURCHASE 1 ACRE 2 GUNTAS OF LAND FOR A TO TAL CONSIDERATION OF RS.3 46 02 975/-. AS PART OF THE SAID TRANSACTION A SUM OF RS.1 CRORE WAS PAID BY THE ASSESSEE AS ADVANCE. OUT OF RS.1 CRORE ADVANCE A SUM OF RS.80 LAKHS WAS PAID BY CHEQUE AND THE BALANCE AMOUNT OF R S.20 LAKHS WAS PAID IN CASH. DURING THE COURSE OF SURVEY CONDUCTED ON 25.2 .2007 THE ASSESSEE HAD ACCEPTED THAT PAYMENT OF CASH OF RS.20 00 000/- WAS HIS UNDISCLOSED INVESTMENT AND AGREED TO DECLARE THE SAME IN HIS RE TURN OF INCOME. 3.1 THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDE RATION WAS FILED ON 28.3.2007 DECLARING AN INCOME OF RS.54 82 350/-. THE AMOUNT OF RS.20 LAKHS AGREED TO BE OFFERED TO TAX DURING THE COURSE OF SURVEY WAS HOWEVER NOT INCLUDED IN THE RETURN OF INCOME. NOTICE U/S 1 48 WAS ISSUED ON 4.2.2008 AND ORDER U/S 147 RWS 143(3) WAS PASSED ON 30.12.20 08 WHEREIN THE AFORESAID SUM OF RS.20 LAKHS WAS BROUGHT TO TAX. PAGE 3 OF 6 ITA NO.1079/BANG/201 0 3 3.2 THEREAFTER NOTICE U/S 274 RWS 271(1)(C) OF TH E ACT WAS ISSUED CALLING FOR EXPLANATION FROM THE ASSESSEE AS TO WHY PENALTY FOR CONCEALMENT OF INCOME SHOULD NOT BE LEVIED. THE ASSESSEE FILE D A LETTER DATED 29.6.2009 WHEREIN IT WAS CONTENDED THAT RS.20 LAKHS BELONGS T O SOME OTHER PERSON AND HE COULD NOT REVEAL THE PERSONS NAME AND OTHER DET AILS AS REVEALING THE NAME OR DETAILS OF THE PERSON CONCERNED WOULD EXPOS E HIS LIFE AND PROPERTY TO RISK. THE INCOME TAX OFFICER HOWEVER REJECTED T HE OBJECTIONS RAISED BY THE ASSESSEE DURING THE PENALTY PROCEEDINGS AND LEVI ED PENALTY U/S 271(1)(C) OF THE ACT VIDE ORDER DATED 29.6.2009. SHE LEVIED MINIMUM PENALTY BEING 100% OF THE TAX SOUGHT TO BE EVADED AMOUNTING TO R S.6 20 000/-. 4. AGGRIEVED BY THE LEVY OF PENALTY THE ASSESSEE FI LED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY. 5. THE FOLLOWING CONTENTIONS/OBJECTIONS WERE RAISE D BEFORE THE FIRST APPELLATE AUTHORITY:- I) PENALTY PROCEEDINGS BEING PENAL IN NATURE ARE TO BE STRICTLY CONSTRUED AND IN FAVOUR OF THE ASSESSEE; II) THE BURDEN OF PROOF FOR ESTABLISHING CONCEALMENT OF INCOME IS ON REVENUE; III) THE SUM OF RS.20 00 000/- DID NOT BELONG TO THE APP ELLANT AND THEREFORE THERE WAS NO QUESTION OF CONCEALMENT OF I NCOME; IV) NO MATERIAL OR EVIDENCE IS BROUGHT ON RECORD TO PRO VE THAT THE SUM OF RS.20 00 000/- BELONGED TO THE APPELLANT OR THE APPELLANT HAS CONCEALED THE INCOME; V) THE SUM OF RS.20 00 000/- WAS OFFERED TO TAX ONLY T O BUY PEACE AND TO AVOID LITIGATION; VI) THE FACT THAT THE APPELLANT HAD AGREED TO OFFER TO TAX THE SUM OF RS.20 00 000/- DOES NOT AUTOMATICALLY LEAD T O THE CONCLUSION THAT AMOUNT AGREED TO BE ADDED WAS CONCE ALED INCOME. PAGE 4 OF 6 ITA NO.1079/BANG/201 0 4 6. THE CIT(A) HOWEVER CONFIRMED THE LEVY OF PENALTY. THE RELEVANT FINDING OF THE CIT(A) READS AS FOLLOWS:- IN THE INSTANT CASE THE CONCEALMENT WAS DISCOVERED AS A RESULT OF SURVEY BY THE DEPARTMENT. IN FACT THE APPELLANT AGREED TO THE ADDITION AS A RESULT OF ENQUIRY. HOWEVER WHILE FILING THE RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION THE SAME WAS OMITTED TO BE INCLUDED ON THE PLEA THAT THE MONEY ACTUALLY DID NOT BELONG TO HIM. THUS ON THE ONE HAND THE APPELLANT CONTENDS THAT HE AGREED TO THE ADDITION OF THE AMOUNT RELATING TO UNRECORDED TRANSACTION DISCOVERED BY THE DEPARTMENT AND ON THE OTHER HAND HE TAKES THE PLEA THAT THE AMOUNT SO DISCOVERED DID NOT BELONG TO HIM. HOWEVER NO EVIDENCE WAS ADDUCED IN SUPPORT OF HIS STAND. IN VIEW OF THESE FACTS IT IS CLEAR THAT THE APPELLANT S INTENTION TO CONCEAL THE INCOME WAS CLEAR AS IT IS BORNE OUT BY FURNISHING INACCURATE PARTICULARS. THUS THE CASE LAWS RELIED UPON SUPRA ARE OF NO ASSISTANCE TO HIM. 7. THE ASSESSEE BEING AGGRIEVED IS IN APPEAL BEFOR E US. 8. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE INCOME TAX AUTHORITIES. 9. THE LEARNED DR ON THE OTHER HAND APART FROM R ELYING ON THE FINDING OF THE FIRST APPELLATE AUTHORITY SUBMITTED T HAT THERE IS NOTHING ON RECORD TO SUGGEST THAT A SUM OF RS.20 LAKHS WAS OFF ERED ONLY TO BUY PEACE AND TO AVOID LITIGATION. IT WAS STATED BY HER THA T EVEN THOUGH THE ASSESSEE HAD PROMISED TO DISCLOSE THE ABOVE AMOUNT OF RS.20 LAKHS DURING THE COURSE OF SURVEY THE SAME WAS NOT INCLUDED IN THE R ETURN OF INCOME. IT WAS PAGE 5 OF 6 ITA NO.1079/BANG/201 0 5 SUBMITTED THAT THE UNEXPLAINED INVESTMENT TO THE TU NE OF RS.20 LAKHS CAME TO LIGHT ONLY ON ACCOUNT OF THE EFFORTS MADE BY THE D EPARTMENT BY CONDUCTING SURVEY AND FURTHER INVESTIGATION IN THE COURSE OF ASSESSMENT PROCEEDINGS. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE MATERIALS ON RECORD. THERE WAS A SURVEY U/S 133A CONDUCTED ON 25.2.2007. DURING THE COURSE OF SURVEY AN AGREEMENT OF SALE DATED 2. 12.2004 WAS FOUND AND IMPOUNDED. AS PER THE SALE AGREEMENT THE ASSESSEE WAS TO PURCHASE 1 ACRE AND 2 GUNTAS OF LAND. AS PART OF THE SALE AGREEMEN T A SUM OF RS.1 CRORE WAS PAID AS ADVANCE AND OUT OF THE ABOVE SAID SUM A SU M OF RS.20 LAKHS WAS PAID IN CASH. DURING THE COURSE OF SURVEY WHEN THE ASSE SSEE WAS CONFRONTED WITH THE PAYMENT OF CASH THE ASSESSEE ACCEPTED IT A S UNDISCLOSED INVESTMENT AND AGREED TO DECLARE THE SAME IN HIS RE TURN OF INCOME. IN THE RETURN OF INCOME FILED ON 28.3.2007 THE ASSESSEE D ID NOT INCLUDE THIS SUM OF RS.20 LAKHS. IN THE COURSE OF ASSESSMENT PROCEEDIN GS THE ASSESSEE SUBMITTED THAT THE SAID SUM OF RS.20 LAKHS DOES NOT BELONG TO HIM. IT WAS FURTHER SUBMITTED THAT MERELY BECAUSE A DECLARATION WAS MADE DURING THE COURSE OF SURVEY DOES NOT NECESSARILY MEAN TO INCLUDE IT IN THE RETURN OF INCOME TO BE FILED. IN THE PENALTY PROCEEDINGS ALS O THE ASSESSEE SUBMITTED THAT THE AMOUNT OF RS.20 LAKHS BELONG TO OTHERS. H OWEVER NO DOCUMENTARY EVIDENCE WAS PRODUCED IN SUPPORT OF THE ASSESSEES CLAIM. THE PAYMENT OF RS.20 LAKHS IS A PAYMENT OUT OF UNDISCLOSED INCOME A ND THE ASSESSEE WAS NOT ABLE TO FURNISH THE SOURCE. THE CONCEALMENT WAS DI SCOVERED BY THE DEPARTMENT AS A RESULT OF SURVEY AND THE ASSESSEE IN FACT HAD AGREED TO THE ADDITION. HOWEVER WHILE FILING THE RETURN OF INCO ME HE HAD RETRACTED FROM PAGE 6 OF 6 ITA NO.1079/BANG/201 0 6 HIS PROMISE. THE ASSESSEE WAS AGAIN CONFRONTED DU RING THE COURSE OF ASSESSMENT PROCEEDINGS AND SINCE HE DID NOT HAVE A BONAFIDE EXPLANATION THE AMOUNT WAS ADDED IN THE SCRUTINY ASSESSMENT COMP LETED U/S 143 RWS 147 OF THE ACT. THEREFORE THERE IS A DELIBERATE ATTEM PT ON THE PART OF THE ASSESSEE TO CONCEAL THE PARTICULARS OF INCOME. IN THE LIGHT OF THE ABOVE REASONING WE ARE OF THE VIEW THAT IMPOSITION OF PE NALTY IS JUSTIFIED ON THE FACTS OF THIS CASE. THEREFORE THE ORDERS OF THE I NCOME TAX AUTHORITIES ARE VALID AND IN ACCORDANCE WITH LAW AND NO INTERFERENC E IS CALLED FOR. 11. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH DAY OF NOVEMBER 2011 SD/- SD/- (N K SAINI) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER COPY TO:- 1.THE REVENUE 2. THE ASSESSEE 3. THE CIT CONCE RNED 4. THE CIT(A) CONCERNED 5. THE DR 6. GF MSP/- BY ORDER ASST. REGISTRAR ITAT BANGALORE.